By Kuldip K. Ambastha and Anil K. Ambastha
On Monday, February 10, 2020, Taubman Centers, Inc. (TCO) was a star performer for the day with its return of 53.2%. A combination of strong quarterly and annual results plus an acquisition offer from Simon Property Group, Inc. (SPG) led to this impressive return. 4Q2019 adjusted funds from operations per share (FFOPS) was reported as 97 cents, which beat consensus estimates and also exceeded 4Q2018’s 91 cents figure. The offer from Simon Property Group, Inc. is valued at $3.6 billion. Simon Property Group, Inc. is seeking an 80% ownership stake, while the Taubman family will sell one-third of its ownership interest and stay on as a 20% partner in a new entity called The Taubman Realty Group Limited Partnership (TRG). As part of the transaction, Simon Property Group, Inc. will acquire all common stock of Taubman Centers, Inc. at $52.50 per share in cash.
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Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in TCO. The principals of Ambastha Financial LLC have short option positions in SPG, while the clients of Ambastha Financial LLC do not have any positions in SPG.
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